Tech Squared (TSQD)- Internet Commerce Message Board

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Microcap & Penny Stocks : Tech Squared (TSQD)- Internet Commerce

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To: Kimberly Lee who wrote (1082)	7/30/1998 9:52:00 PM
From: burgerking	Read Replies (2) of 2752

TSQD valuation fair ... I think the valuation of TSQD (trading at 6 1/2) at this point is pretty close to correct. There's a lot of unknowns out there to state that it's a great buy. They have 3.2 M shrs of DRIV which may be worth quite a bit in the near future, but the tech analysis on most internet stocks for the next week seems pretty dreary (a rally today, but no one "broke out"). TSQD's latest 10-K states that there are 10.9 M shares and the stockholder's equity is $3.1 M including $2.6 M in DRIV. This means that if we sold everything TSQD owns now it's worth $0.5 M plus the 3.2 M shares of DRIV. And TSQD's core business is selling Mac's -- not a great business to be in. Therefore TSQD's intrinsic value isn't great. I have no idea what TSQD's management plans on doing with the equity they gain from DRIV's IPO, but I would guess that a fair portion will go into continuing to transition the company to Wintel products. This is a very competitive business. So even if DRIV trades at 30, this will mean TSQD gets a bonus of 96 M in equity. ($8.80 per share), but will this bonus ever get passed on to the shareholders? Also, DRIV may not be as hot as BCST, but more like more like SWNT which is currently trading at $14 3/8 per share. This would translate into $4.22 per share. Therefore at current prices IMHO, TSQD gets a "buy" rating but not a "strong buy" Other thoughts?

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